# What Was Form 1040EZ, and Why Is It No Longer Used?
**Summary:** Form 1040EZ was the simplest IRS individual income tax return for filers with very basic tax situations. It was eliminated after the 2017 tax year in favor of a redesigned Form 1040 that uses a modular ‘building block’ approach. The 1040EZ allowed only limited income types and credits, could not claim dependents or many deductions, and was phased out to give taxpayers greater flexibility and to streamline IRS processing.
## Definition & Key Takeaways
## Why It Matters
## Formula & Variables
## Worked Example
## Practical Use
## Comparisons
## Limits & Misconceptions
## Research Notes
## Definition & Key Takeaways
– Form 1040EZ was the shortest, simplest IRS individual income tax return intended for single or joint filers with no dependents and limited types and amounts of income.
– Eligible filers generally had taxable income under $100,000, less than $1,500 in taxable interest, no dependents, and only certain income types (wages, salaries, tips, unemployment, taxable scholarships/fellowships).
– The form disallowed itemized deductions, many adjustments (e.g., IRA deduction, student loan interest), and most credits; it permitted limited items such as the Earned Income Credit in eligible years and an election for nontaxable combat pay.
– The IRS discontinued Form 1040EZ after tax year 2017; the redesigned Form 1040 and accompanying schedules replaced the trio of 1040, 1040A and 1040EZ to allow more flexible, modular reporting.
– Its retirement reflects a trade-off: ease of use for a narrow group versus flexibility and clarity for a broader population.
## Why It Matters
Form 1040EZ is significant in tax history and personal finance because it represented an era of simplified filing for taxpayers with very basic returns. Understanding 1040EZ helps users and practitioners appreciate how filing requirements evolved, why the IRS moved to a consolidated Form 1040, and which taxpayers once benefited from the shortest possible form. Lessons from 1040EZ also illuminate modern filing choices, eligibility for credits, and pitfalls that persist for filers attempting to use simplified filing paths.
## Formula & Variables
Tax computation on simplified forms follows the same conceptual structure as other individual returns. For clarity, define symbols and a minimal set of equations used in a 1040EZ-style computation.
– GI = Gross Income (total wages, salaries, tips, taxable scholarships/fellowships, unemployment compensation)
– I = Taxable Interest (must be < $1,500 to qualify for 1040EZ)
– ADJ = Adjustments to income (1040EZ generally did not allow common adjustments; set ADJ = 0 for eligible filers)
– SD = Standard Deduction (dollars; varies by filing status and tax year)
– TI = Taxable Income = max(0, GI + I – ADJ – SD) (dollars)
– T(x) = Federal tax computed from tax tables or tax rate schedule applied to TI (dollars)
– C = Tax Credits allowed on 1040EZ (limited; e.g., certain Earned Income Credit amounts) (dollars)
– Tax Due/Refund = max(0, T(TI) – C – Withholding) or Withholding – (T(TI) – C) for refund calculation (dollars)
Units: dollars. Scales: household annual income (e.g., $0–$100,000 for historical 1040EZ eligibility).
## Worked Example
This example illustrates how a typical 1040EZ filer for an historical year might have computed tax.
Scenario: Single taxpayer, age 28, wages $30,000, taxable interest $100, no dependents, no adjustments, federal income tax withheld $2,800, eligible for no additional credits.
Step 1 — Confirm eligibility
– Taxable interest I = $100 ( $1,500 makes the return ineligible
– Having dependents: 1040EZ did not allow dependents to be claimed
– Foreign income or foreign address filers: ineligible
– Claiming deductions or credits disallowed on 1040EZ (e.g., student loan interest deduction, IRA contributions)
– Misreading allowable income types — self-employment income, rental income, and many other sources disqualified a filer
## Comparisons
Related forms and when to prefer historically (and today):
– Form 1040 (standard): Historically the most comprehensive form; preferred if you have dependents, itemize deductions, report many types of income, or claim sizable adjustments/credits. Today’s redesigned 1040 is the single gateway with supplemental schedules.
– Form 1040A (historical mid-range): Allowed more credits and adjustments than 1040EZ but fewer than full 1040; useful for moderate complexity without full itemization. Also discontinued after 2017.
– Modern Form 1040 with schedules: Post-2017, the redesigned 1040 plus schedules replaced the simplified forms; use this for most filings now—modular schedules render the old 1040EZ unnecessary.
When to prefer: historically, 1040EZ was preferred by taxpayers with only wage income and minimal interest and no need for deductions or credits beyond the very limited set the form allowed. Today, there is no 1040EZ; taxpayers use the redesigned Form 1040 and only attach the schedules that are relevant.
## Limits & Misconceptions
– Misconception: “1040EZ was the fastest and always the best option.” Not true — it was the simplest only for a narrow subset of filers; many taxpayers required the broader capabilities of Form 1040 or 1040A.
– Misconception: “1040EZ returns had lower audit risk.” Audit risk depends on many factors; form simplicity alone does not eliminate scrutiny.
– Limit: 1040EZ could not capture many common tax situations (self-employment, rental income, significant interest/dividends, dependents, many credits and deductions).
– Legacy confusion: Some taxpayers still ask for a 1040EZ; the IRS eliminated it to avoid confusion and to consolidate filing onto the redesigned Form 1040 and schedules.
## Research Notes
Sources and methodology
– This article synthesizes primary IRS guidance and forms (historical 1040EZ and the 2018 Form 1040 redesign), explanatory coverage from reputable tax information sites, and historical tax tables to illustrate examples.
– Primary sources consulted include IRS instructions and archived forms, Investopedia summaries, and tax-policy commentary offering context for the 2018 filing changes.
– Methodology: review of form instructions and eligibility language, comparison of allowable income and credits across forms, and construction of a numerical example using representative standard deduction and tax schedule values. Examples are illustrative and not a substitute for year-specific tax calculations.
Primary references (representative):
– Investopedia — “What Was Form 1040EZ?” (overview and history)
– Internal Revenue Service (IRS) — archived instructions and the announcement on the 2018 Form 1040 redesign
– Tax policy and practitioner summaries explaining the practical effects of consolidating 1040 forms
Educational disclaimer: This article is for informational purposes only and does not constitute tax advice; consult a qualified tax professional or the IRS for guidance on specific filing situations.
### FAQ
### See also
– Form 1040
– Form 1040A
– Standard Deduction
– Earned Income Credit
– Tax Filing Status